In this episode, Jared and Justin sit down with Sean T. Dugan of Dugan Production Corporation to unpack the often messy world of estate planning. Sean shares what it’s been like stepping in as the third generation of a six decade family oil and gas business and the challenges that come with unclear communication and disorganized inherited assets. Together, we talk about how family dynamics, business responsibilities, and legacy planning can collide and why proactive conversations matter. It’s an insightful look at preparing the next generation and avoiding avoidable pitfalls when it comes to passing down a family enterprise.

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Welcome to Financial Planning for Oil and Gas Professionals, hosted by certified financial planners Justin Brownlee and Jared Machen of Brownlee Wealth Management, the only podcast dedicated to those of you in the oil and gas profession to help you optimize investments, lower future taxes, and grow your wealth.

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Welcome back to another episode of FPO Income Financial Planning for Oil and Gas Professionals.

This week we are excited because Justin and I get to interview a guest, a friend, Sean T. Dugan of Dugan Production Corporation.

He is the third generation, been in business for 60, 65 years.

67.

67 years.

And I'm excited to have him on the podcast because we're going to talk about a topic we talk a lot about, which is estate planning, but we're going to take a different vantage point and look at it from the inheritor's point of view.

Sean, welcome to the show.

Hey, cool.

First time, long time, Great to be on this podcast.

And as I said earlier, I flew all the way to Fort Worth.

I skipped Dallas altogether and came straight to Fort Worth.

Beautiful day here.

Great to be here with you guys.

So thank you very much.

And you know, it's my first day in Fort Worth.

Our first couple of days in Fort Worth were temps under 40 degrees.

So thank you for bringing the cold temps from Colorado.

We appreciate it.

So, Sean, you listen to the podcast.

So we start off with a surprise segment where we don't have any idea where the question is coming from, but in the spirit of that, you offer to ask us a surprise segment question.

Yeah, that's right.

So what do you got for us?

Yeah, since I got both my financial advisors sitting right here in front of me, I just wanted to ask a question like, what's the weirdest thing you've seen one of your clients buy or an investment that you thought was a terrible idea or but then it turns out to be a pretty good one, and you go, wow, maybe I should buy all the old vintage video games I can find or something.

That is such a good question.

And Jared, I'm just going to start thinking out loud with this and I think we might land on a few things.

First thing that comes to mind is a pretty mild answer.

We have a lot of clients who will have significant equity compensation, so they'll have RSUs and they will have a lot in one stock.

The prudent thing to do there is to sell it right and diversify and make sure that you're building some financial independence outside of one individual company.

But I mean, Jared, how many times have we told clients this, we are at the point of selling and they might be sitting on more shares that, you know, for tax reasons we may not sell it all at once or they might have future vesting events.

So we always say, hey, we hope we're wrong.

We hope that in six months you're a little bit mad at us because we hope the stock keeps going up.

And so I think one of the just crazy things has been to see Nvidia do that is a vivid example of just, hey, this stock has gone up 10,000% in a short period of time and it just has continued to do that.

And so that's been pretty incredible.

I also want to think through more obscure assets and what has happened there.

So I think one of the ones it's not, it doesn't sound unconventional today, but I had a.

So, you know, I didn't even have a client.

I had the kid of a client come into my office.

I was offered to meet with him as kind of a service to the client.

And he would not stop about bitcoin.

And like that was before really, it was like any mainstream at all.

He had just graduated college, was like working, you know, at a tech startup and like in that ecosystem.

And he would not stop talking about it.

And I was like, okay, why are we even having this meeting, man?

Like, you clearly got, you clearly don't want advice from me.

You're all in on this.

And he was just, I forgot the percentages, but it was a meaningful amount of his balance sheet that wasn't bitcoin.

And I thought it was crazy and like, it was like a fervor for it where like nothing I could have said, could have talked him out of it.

And you know, of course, in hindsight that doesn't sound silly, but at the time I thought it was ridiculous.

You know, Jared, I think part of me struggles with this question though, Sean, because I'm a little bit of a fun captain.

And you know, I think you can attest to this, Jared, our clients that own businesses, like we have a few that own some privately held businesses.

And my message to them truly is, hey, a diversified portfolio is probably not going to beat a well run private business.

Like, it's just not.

And so frankly go all in on that.

And at some point, and you know, Sean, you have a wonderful experience of this.

At some point, you can't reinvest back in the business.

Like you've already Maxed out what you can reinvest, and at some point it does begin to kick off funds that do get to be invested elsewhere.

But until you reach that point, try to reinvest everything back into the business.

That has a much higher ceiling than a diversified portfolio, which, Jared.

I mean, I think it's fun from our vantage point because we get to talk about that from experience.

Right.

And so I think.

I think there is an element where sometimes we are the bad guys and we're saying, hey, don't.

Don't invest in this, diversify this.

But then there's other times where, you know, kind of am, hey, I'm on.

Let's go like, let's go all in on this business.

And that's the fun, fun route.

Yeah.

One other client that, that I've worked with in the past, they had a percentage of their balance sheet was too high, made me uncomfortable in art.

And it was just, it was.

I mean, I guess it was a pretty diversified portfolio of art.

But having that much of your household assets in PA in like, art that you had and, you know, a good proportion of it just around their house was just really, really unique and interesting.

And of course, you know, they didn't ask for our permission to do that.

They came to us and they already had that, their balance sheet.

But that was just like a really interesting way to allocate your capital.

And, you know, it's like, hey.

And luckily, I guess they had good taste because it, you know, the appraisals and the valuations were nice, but it was an interesting way to kind of construct a balance sheet.

And, you know, I just.

Anytime you talk about art, I think it's so fascinating.

Or any obscure asset.

What if it was mark to market constantly?

What if there was a literal every second value, like it was a publicly traded stock?

How crazy would that be to just see over the last 10 years, where did that go?

Well, isn't there that service now where you can buy fractional shares of major artwork and.

Yes.

And you can see what the daily market is going on those things right now.

That's a great point.

No, I was bringing up, like, what I learned.

And this is.

Since I'm a father now and I have my own kids and they're making their own collections and all this stuff.

My cousin, my little cousin, he had all those Pokemon cards.

Just had them for ever since the 90s.

Well, he just recently cashed out of those cards like mid, like six figure from all that collection.

Oh, my.

Like, he had all the cool Pokemon Cards.

And apparently there was this big boom a couple of years ago of people trading them and all that stuff.

He got it out for six figures and I was like, whoa.

And so now my kids, when they're collecting all those random things from the toy stores, I'm like, okay, great.

And, and, and I still blame my mother for throwing out my comic books.

I'm just saying.

Oh, it.

That reminds me of my financial plan from when I was 8 years old.

Beanie Babies.

I was convinced, you know, that was going to make me a fortune.

And then the ones with like the misspelling on the little heart are actually worth more because like, they were like an incorrect, incomplete thing.

But I think, like, I think you touched on something important, Sean.

I think like, nostalgia is the next frontier in investment.

And that's where I'm at as like, people get more automated, like AI takes over everything.

It feels robotic.

Like we connect with things and like we connect with stories.

And like, if I can invest in something that remind takes me back to a place of like my childhood, like, that's gonna be valuable and like, for our generation, like Pokemon cards are having a moment.

Because that was what was invoked.

And I think, you know, I think.

And again, like, it may or may not end up being a good investment, but like, not all, you know, there's a bunch of different ways to.

Some, some investments you have for financial returns, some investments you have not because they are going to make a lot of money, but because it makes you feel a type of way every time you look at it.

Yeah.

So I feel like everybody should have some sort of nostalgic investment of some sort, ideally.

That's right.

I love that.

All right, well, let's.

Sean, let's chat about you and your experience.

Right.

Because like, I feel like so much of our estate planning conversations are theoretical or it's like, hey, you know, people are decisions for the next generations that aren't even going to be actualized for decades and decades.

But you have kind of lived this.

So I'd love for you to talk with us at a high level kind of.

What exactly did you inherit?

Like what it like, and how much did you know about, like, what was going on with you and your family?

Well, here, Jared, I'll give you a little background on us.

We are an independently owned and family owned oil and gas EMP company out in the San Juan Basin.

My granddad was brought out to that basin with ConocoPhillips after graduating from the University of Oklahoma with a petroleum engineering degree.

After the World War II.

Bought one tank.

He bought one well from Conoco because he liked the tank, sold the tank, put a cheaper one out there and basically started a service company, which we've now grown into our own EMP group.

We operate thousands of wells in the San Juan Basin, and we're drilling new ones all the time.

So a testament to him and his hard work and my father, who was a geologist, and they grew our family firm.

So I inherited a lot of physical.

Responsibilities and liabilities and a lot of different asset classes.

So.

I grew up knowing that this was coming a little bit as anyone.

Denial of all those kind of things, wanted to be your own man, do your own thing, but then you keep coming back and you see the people and you see the employees and you see the assets and the work, and you start taking pride and ownership over that.

And so.

I inherited a lot of responsibility, but I was also very grateful for what I do have.

So let's preface that.

So specifically, I inherited a lot.

We had it.

We've had a little taste of everything.

They did their.

Between the three generations, they did their estate planning three different times.

You got your AB trust, your irrevocable life insurance trust.

You've got anything that was in vogue, we've got it.

And then they put me, the third gen, as trustee over all of it.

Most of it.

So, yeah, there's a lot.

Yeah.

Yeah.

We call that estate planning du jour.

Right.

And like, I would say right now, like slats are that there's always some strategy that everybody's, like, really excited about.

There's a lot of energy.

But the problem is estate planning, it's moving, right?

It's a dynamic thing, like your goals and wishes change, but also tax policy changes.

Right.

So you can't just it and forget it.

And it sounds like, Sean, in your experience, strategies were stacked on top of one another versus coordinated and in a coherent.

In a coherent way.

So I'm curious for you, how much of this, you know, it sounds like you stepped into a lot.

You know, both managing kind of the estate administration and, you know, responsibility with this company doing meaningful oil and gas production.

How much did you know was the expectation, hey, you're gonna do this.

You know you're gonna do this.

We're preparing you for this.

Did you have any idea the scope of what was gonna be asked of you and did they talk about it beforehand or did you kind of just step into it blind?

A lot of it was just big picture level that I was aware of, but then I was pretty much thrown into the deep end part of it.

Of what actually.

What does a trustee actually do?

What does hims actually mean?

What do you mean you still have to go to probate even though you have a trust?

What do you mean I can't treat my siblings differently because I'm the trustee?

You mean I have to everybody.

I have to be even more fair than, you know.

So I'm the big.

I was an older brother, a CEO, a trustee, a grieving son, all at the same time.

So it was a very confusing time.

You know, now it's been 12 years, so we've gotten through the hard part, but it was rough, I'll tell you that much.

There was no primer.

There was no.

This is what you need to do.

This is who you need to call.

This is what needs to happen.

Luckily, I knew the players and I knew the attorneys that drafted all the documents, so I was able to lean on them a little bit.

And then they kind of took it and ran until I got up to speed.

But that was a pretty steep six month learning curve to get thrown into.

Oh, yeah.

And run the business at the same time.

And all the employees were grieving at the same time too, because they all loved my granddad just as much as the rest of us, so.

And when your founder goes.

It becomes very turbulent.

We can use that word.

And Sean, one of the interesting things in your situation.

G2 pre.

Deceased.

Oh, yeah, And I should preface that too.

My father.

How did that throw a wrinkle?

Yeah, sure.

Let me preface that too.

My father actually got ill and passed before my granddad did and my grandmother before him.

So it's like we had everyone.

And this isn't being critical, but they just kind of passed out of order.

There was a lot of generation skipping trusts in place.

Well, those generations had to skip the skip.

That was the skippy.

So it's like things that were supposed to fall on my sister and I kind of now are falling on my children who didn't exist at the time.

And the things that were skipping, my dad fell to us.

So it's like everything got moved out of the.

Out of order became a lot of estate.

We were very much.

They were very much a taxable estate.

And there was issues with IRS taxes.

There were issues with putting the life insurance in the wrong vehicles.

So they were buying a lot of life insurance, whole life insurance policies, which was super cool back then, and they were sticking them into family limited partnerships, which is what, you know, was in vogue.

But then there was no way of kicking the money out to where it needed to go to actually tackle the estate taxes.

So there was, it threw a lot of wrenches having everyone, not that you can plan when you're going to die, but having folks doing the estate planning for folks to decease in a certain order and then it gets thrown out of whack and then you're having to.

Now compound everything by doing a bunch of inter family loans either between your privately held business or your family.

Partnerships.

So you're going in debt twice because you're going in debt to yourself, but you're also already kind of leveraged with the IRS trying to pay off estate taxes at the same time.

Yeah, I mean, I gotta just summarize.

This is the perfect estate planning storm, right?

You have multiple dimensions of estate plan that is kind of built on top of one another without congruency.

You have a family order of operations that completely blew up the GSTs, the generation skipping trust.

You have a lack of liquidity because you know, the principal asset is the primary business and there's.

The liquidity is not in the right places.

It needs to be to manage the estate tax appropriately.

And then you are thrown into.

There's.

Doesn't sound like there's any business succession plan.

There's nobody internally who, you know, because from my understanding, you weren't actively working for the company prior to this happening, right?

No, I had my own business, I had started my own thing.

I was in a different state entirely.

So I mean it really is, it's a perfect storm, man.

And like I'm just remarkably impressed that you managed this.

So I've got to know, like, you know, as you've gone through this, I'm sure there's, there's, there's no playbook for this.

I'm sure a lot of it was you figuring it out yourself, reading the same.

What I did, honestly is, and this is, you know, it's hodgepodge.

And I'm not, again, I'm not being critical of my predecessors, but they literally had 25 different books on estate planning by 25 different people.

So 25 different plans.

Now, some of it overlapped, but I started by reading the books that they had and they had highlighted inside the books specific paragraphs.

And so I was like, oh, well, this is probably why they did it this way.

And so it was just, it took a couple of years just to get the chaos under control.

And then first you're angry because you're like, oh my gosh, like why, why did you give me all this responsibility but none of the liquidity to actually solve, get myself out of it.

Now we had a beautiful family owned business with a lot of retained earnings and all this other stuff.

So they built it and built it and built it and built it, but they didn't plan for what comes next because they planned it, they did it, their state plans, as if they were never going to, to go.

And so at some point I learned a lot that like, okay, well now I'm going to make sure my children know exactly where the liquidity is coming from.

I know exactly how to communicate with them now of what to look out for and how to prepare them.

And I've learned to also trust my beneficiaries and let them have opportunities to succeed and fail while I'm still here.

So it could be a teachable moment as opposed to just diving straight at first into it.

Yeah.

And I mean, think about like that, that is a severe cognitive load to take over a family business, but also to try to get your arms around this estate stuff.

But you're not on your A game, you're grieving.

Right.

And so I'm curious for you, like, you know, how old are your kids?

I have a, a nine year old and an almost seven year old, so.

And wait, no.

And a three week year old or six week year old at home.

Exactly.

So I'm three now.

So I'm curious for you as you, as you think about them and what you inherited.

And I'm sure the answer differs over time depending on their age, but how do you think about kind of equipping them along the way to where, you know, inevitably when they do kind of take over in some form of franchise and to what extent and what do they know and how have you been kind of preparing them so they're, you know, more prepared than you were.

What I've learned the most out of a lot of this and you know, I'm really kind of just talking about the big picture issues here.

There's a minutia because each layer of trust documents had different set of rules.

So as a trustee there's, I don't know, I'm enacting like seven different types of rules for each different type of trust type.

So it's like, okay, well this one has hims language, this one doesn't have hims Language.

I was like, okay, here's what I'm going to do.

Being a trustee and a beneficiary, I want to simplify the process I like for my children.

I'm going to pick a plan, we're going to try our best at sticking to it, but I'm going to be way more vocal about it with my kids.

Then this is how this works.

This is the rules.

These are the guardrails that you're going to have until this amount of time.

But then after that, there you go.

And I'm going to allow them to be active participants in the actual planning process as opposed to finding out when you're gone, which sounds.

Which was not ideal.

I would have rather known ahead of time that this is what was going to be required.

I may have fought it a little more and been more vocal about it, but it was better than just, here you go, here's your.

Here's your inheritance.

It's 15 years of work to get it all taken care of, but it's all done now.

I know that your experiences influence you in this way.

And so what do you think about that in terms of letting kids have some opportunities to maybe have some responsibility and some at bats, if you will, at younger ages?

For sure.

I grew up knowing that I was going to be a beneficiary of a trust.

I knew it was going to have shares in our privately held corporation.

I knew that there was.

Cash and all that kind of stuff.

I didn't grow up talking about it enough.

I wish we had had more.

We spent most of our time talking about how we can make more.

We didn't spend enough time talking about what to do with it after we've actually won the game.

And that's what I'm going to.

Have my children do.

And I am going to be willing to let them have swings at the plate, like give them lump sums.

If they end up buying a car with it or doing something silly with it or whatever.

Well, that's not what I would have done.

But you got to let them try it and let them fall on their face.

I wish I had more opportunity.

To fail before I was actually up in the majors because I got thrown into the majors.

Here's a bunch of cash.

And then you're like, well, that's not even going to solve my problems or that's not going to make all the issues go away.

I can't spend this right now.

And then it almost makes you timid to actually do any of the things you know, fundamentally are correct because you want to make sure that all the.

Necessary requirements are taken care of.

Because if you don't plan for the plan, there actually is no plan.

It's just a bunch of words on a piece of paper and you're, you're held to that standard.

Yeah, I love that.

I like the idea of like age based distribution.

So giving your chance, your kids a chance at bats.

Sounds like in your case the age base were too like deferred.

They're all over the place.

I'm telling you, I got, and again, I'm not just saying saying this.

I've got trusts where I got it immediately as soon as everything got cashed in.

I've got some that I don't even, won't even sniff until I'm 55 years old.

Like it's, it's all over the place.

Like it was like every two years something new or five years something new was kicking in again.

It's just, it was, it was a lack of consistency across the board.

If you want it to be 30, make it all 30.

If you want it to be what?

There's nothing wrong with it and you know your beneficiaries, but.

I have learned that.

It'S okay to let them have it earlier and I'd rather them watch them enjoy it as opposed to not being here and not seeing it.

And if.

I've seen it both ways, kids take it and they screw it all up and all that other stuff.

But I've also seen them rise and do really cool and great and creative things with it.

Yeah, I think you touched on something important about connecting.

Right.

Like giving your kid at bats but also giving them a lump sum on because they're picking up the pieces.

Right.

And it sounds like as you were picking up the pieces, that's when you had the least liquidity.

So there's kind of this big disconnect of, hey, I'm doing all this work trying to put the pieces together, but I, it's, it's pretty much a fortress that I can't tap.

But I'm, I'm, I'm supposed to, I'm supposed to upkeep this, but I'm not getting any of the benefits of doing all the work.

I'm working, I'm working, I'm working full time for the business.

And then another full time job trying to administer several different estates simultaneously.

But I'm not getting any of the economic benefit of settling these estates.

Nope, I didn't.

There is language in those trusts that I could have paid myself compensation for doing it.

And those were really, actually were full time jobs.

But I didn't, I didn't feel right taking a paycheck for it.

I was just doing it for my siblings and I.

And because we were a taxable estate and because.

There wasn't enough liquidity, you had to make a deal with the IRS to.

Make payments.

So you're basically leasing your family business from the government until you've gotten it all paid off.

Now, sure, the, that was a favorable tax rate and Justin and I could go round and round over what makes more sense to just pay it all off in a lump sum kind of deal or just use the government's terms and pay it over time.

But something about that just didn't feel right because it felt like we didn't actually own the business anymore until we paid the estates off and then the intra family loan.

So you're.

So you had debtors and it was the government.

And that's the one person I do not like being in debt to.

What an experience to have a privately held company that has a healthy balance sheet and stays out of debt.

Right.

And then all of the sudden you're in major debt and it's uncomfortable.

It's uncomfortable.

And then a downturn in oil and gas prices and now you're sweating.

So then your company goes into debt.

So then you have to actually borrow and do margin loans and do all those kind of things just to make the estate plan payments.

There was a couple of very lean years where I literally was borrowing from the IRS to give to the irs.

It was really weird.

And you're paying interest all over the place.

And I know that's not what they intended.

And you know, our industry is very volatile and there's up years and down years, but don't die on a downturn like folks.

It makes it harder.

Unless you've got a lot of cash reserves saved up or away that you intended to pay off those kind of expenditures.

It just puts a lot of pressure on your trustees, especially if those trustees are your kids and you want to keep the family business going.

Yeah, yeah.

I want to ask you about that next because like a lot of people, when they're completing estate planning documents, it's like, who do I name as trustee?

And like, you know, hiring a corporate trustee that's a whole process to hire and those services are a lot of times expensive.

But then also conversely, if I make one of my kids a trustee, that's a lot of liability.

And you know, because I'm a beneficiary of this trust and I'm the person administering this trust and so it's just a delicate tightrope to walk.

Having served, having worked with a bunch of different types of trustee arrangements and been an executor and kind of navigated all of this, there's probably not one right answer.

But how do you think about who do you name as trustee?

This is a really, I have a lot of opinions on this subject.

A lot of these kind of trust and holding companies and partnerships and all that stuff.

Yes, I'm the trustee of them.

Now there are other ones where they had set up just irrevocable life insurance trusts where they hired third party corporate trustees.

Now I'm telling you, some of them were like big national banks.

I'm not going to name them because I got nothing nice to say about them.

Some were big and some were private trustee companies.

I've had more issues with the private ones than I did the big national ones.

See the big bank ones, they're scared of getting sued and they play by the book and everything's literally by the book but you pay for that privilege.

It's very expensive.

But in fact.

The bank was making way more on their trustee fees than the trust was actually making just existing.

So what I would do, I don't have an issue having private corporate or corporate trustees, but I will be putting language in there that my children or my beneficiaries will be able to change who that corporate trustee is.

If they aren't performing, they're over feeding them, they're doing the whole thing.

It will make it a lot easier for the beneficiaries to make a change.

If you're, you know.

Yeah, if my kids are minors or something like that, yeah.

They need someone that knows what they're doing in charge, at least supervising them until they get to that point.

But when my children or beneficiaries are of age, I want them to have the power to pick who is going to do it.

If they want to step up and do it, great.

If they don't and they're getting feed to death or they're getting, they don't get along with the corporate trustee, I'm going to give them the ability to make a switch.

And do you see yourself kind of carving, you know, because the kids might.

Kids are going to be different.

And so do you see yourself kind of the trust being carved out and giving kind of them independent discretion of hey, I want to be, you know, or is it all going to be kind of pooled assets or hey, my kids might want different things and kind of giving them sub trust so they have kind of independent agency of how that might be administered.

True.

Well, it's all going to be divided equally.

Oh my gosh, this is so funny.

We're reading the Old Testament, bringing this up because like we got to this section early on where, oh shoot, what's his name?

He didn't like it that his older brother was going to get all the inheritance.

And so what does he do?

Is the old man, father can't see, can't hear, so he puts an animal fur over himself and he dresses up like his older brother and lowers his voice and changes his voice.

Isaac and Jacob.

Isaac and Jacob, that's right.

And my daughters asked me like, wait, why is he going through all that?

Why is he trying to trick his dad?

And I was like, well yeah, he's trying to get the blessing because whoever the father gives the blessing to gets the inheritance.

And they say, well, why, why not the daughters?

I said.

Because it always went to the boys.

And they did not like that whatsoever.

And they said, well, who's getting your inheritance?

I was like, back then I was like, well, it'd be your baby brother.

And my 9 year old just about flipped her lid saying, what are you talking about?

That's not fair.

And I was like, well, that's not how it works these days.

So it's like, we'll see.

And so the plan is to make sure that.

With my families that it's all divided up equally.

I think two planning opportunities that I think like estate planning is changing.

Well in this way you can have what's called a trust protector.

So this person can't serve as a trustee, but their job is to protect the interest of the trust.

So let's say you're not comfortable with your kids being named that person.

You can name a trust protector that is a third party, like a law firm that prepares the documents or an advisor or whatever, where they can't serve as trustee, but as trust protector, they can nominate the subsequent person.

So I really think like, even if, you know, whatever, whoever you name as trustee, giving what I would call freedom to move about the cabin is very valuable, right?

Saying, hey, I want, I want some sort of trust protector.

And like the other thing I would caution here is like Some of the trusts and you know, have very specific language about who can you like, hey, it needs to be a trust company or a bank and that boxes you in.

There's a ton of innovation happened on the trust administration side.

There's, you know, what's called professional fiduciaries who can administer trusts who might not be asset managers or big banks, but you know, they, they can be trustees, do trust accounting and provide a much more reasonable cost relative to market.

So two, two like words of caution.

If you want to execute what you're talking about, have a trust protector, somebody that can step in and make sure that you're not getting feed to death or that you can do the things you want to do or that the trust was intended to do.

And then don't, don't have archaic language about requirements, about assets under management or it's got to be a professional registered trust company because there's lots of people who can administer a trust in between your kid or a professional trust company.

Yeah, we've, we've seen, I've seen a little bit of everything during this process.

I just can't recommend it enough.

If you're going to have hims language in your documents, consider adding one word to the thing, enjoyment.

Now you can cap what enjoyment means, you can put caps on it.

But if you limit them just to those things and you hire a corporate trustee, they will literally just enforce it to the word that you put in there.

And you say, well, I didn't intend for it to just have specifically those four line items.

Well, corporate trustees, don't they take it at its word.

And you can add extra paragraphs.

I'm going to add some extra paragraphs of what?

Define further what those means.

And I know they keep it broad and that's what lawyers want to do.

They just want to keep things broad and all that other kind of thing.

But it will be taken literally after you're gone.

And.

If that's not what you intended for your beneficiaries, I would take a hard look at the words that you use in those kind of documents.

Sean, we didn't talk about this question, but I'd love to get your thoughts on it.

Your company's been around for over six decades and private equity and really every super major has kind of entered the picture which has effectively made it the easiest it has ever been to sell a company.

And so we just have case after case all over the country and not just oil and gases.

In every industry we have people selling the company they founded well before they pass away and the estate plan, you know, comes into execution.

So what was some of the good parts, what was some of the pros of inheriting an actual business rather than just, you know, let's say your grandfather had taken a check and sold it.

15 years ago, gotten the deal.

Well, one, there's a lot of pride in having ownership over a family owned business.

There's a lot of pride in what we do and being members of our community, being able to physically basically.

Help with our employees or giving of our time or giving of your employees time to certain causes.

There's a lot of pride in making sure all those of the hundreds of people that we have working for is that their families are fed.

There's a lot of pride in knowing.

That at least for that corner of our little basin, that it's, it's secure and structured and all of that kind of stuff and that our community still has a bedrock company that's still there.

And we, we haven't sold out and moved to the big cities and you know, headquartered in, in Houston or Fort Worth or Denver.

That's what a lot of the family owned businesses did here.

They moved to the, that were there.

They've all kind of sold.

And M and A has happened and I'm not saying it's never not, but is sure a lot of fun too at the same time.

And you got to have to like the game.

The oil and gas industry is a lot of, it's very interesting and I've obviously been around it my entire life.

It's sort of just in our DNA.

And.

So yeah, it is tempting.

We get offered all the time from this private equity folks to come in and take some and buy some and sometimes when the prices are real high, it becomes very hard.

No.

And even my predecessor almost sold a couple of times, but he did.

My granddad didn't.

And so I'm just like, well, I like showing my kids this is what hard work looks like and this is how you grow a business.

And it's kind of fun to see how, how big you can actually make it.

They set the, they set the standard and they did all the sweat equity to build it.

So I wanted to see how far we could take it after we did that.

So.

Also.

You know, no one's actually called to see if it was for sale.

So you know, until then I'm just, we're gonna grow this thing.

We're having fun.

Sean, I think, I think kind of a good place to wrap up.

I would love, I kind of just Want to, man, we covered a lot of ground.

I just like being on the other side of it.

You know, it seems like you've kind of, you know, you kind of mentioned, hey, this has been a decade long plus process to get your head above water is you kind of talk to our audience and most of our listeners are probably thinking through the inherit, you know, passing down assets to inherit and what advice do you have for them?

It sounds like simplify, like, you know, like, hey, giving to your kids in some fashion at bats today.

Like I really just want to open it up to you.

What other advice do you have for families thinking through this?

Yeah, I've really taken.

This whole process and it's been up and down.

It's been up and down.

There's been years that I've loved it.

There's been years that I was like, oh my gosh, why do they do it?

I should all just resign from all of these and just let somebody else do it it and pay someone else to do it.

But.

To me it's like I really, if I'm going to give beneficiaries some assets, I want to watch them and give them advice on it.

So I'm planning to give it to them ahead of time and so to see what happens now.

Yeah, no, like the direct, if we still have the business, the direct family stock.

No, of course not.

We're not going to be able to leverage that and take loans against it.

That's.

But that's in our corporate bylaws.

We already couldn't do that.

So we're protecting ourselves in that manner.

But the actual hard cash and all that stuff.

Yeah, let them.

I'm going to let, I'm going to challenge them and see if they can see how they can manage it because I would rather them be able to ask me questions about it than you later on trying to figure out why I did things the way I did it.

And so it's either write a very detailed outline to your beneficiaries why you're doing it this way, because if you just hand them a bunch of trust documents, it's going to just read like lawyers and it's not going to have your voice to it.

And so I'm going to put my voice either physically or write it down of why we did it the way we did it and trust them to.

Be the beneficiaries.

Yeah, I would strongly suggest that you review and communicate with the people that you're giving inheritances to, what it is and what they're getting and how they should.

How you would.

How would you like to see them manage it and also let go of control, because you're not going to be here and let them.

Let them have a shot at it and trust them because they're.

They're yours.

So trust them to do it.

Absolutely.

So one of the things about Sean in his free time, and we didn't even get to touch on this, he had a career pivot.

He was working in Hollywood doing production stuff.

So I.

When he was talking about that, I. I couldn't help but think an estate planning docu series for his kids.

And, you know, he'll have plenty of conversations before, but after, it'll be.

It'll be like a, you know, a private docu series with all the nuance and the history, and it'll be perfectly edited.

So I'm looking forward to watching that.

I probably should write the 25th book on, like, from a beneficiary's perspective.

That's right.

They just need one more book.

Yeah, we need one more.

Yes.

And it's Cliff Notes of all the other books.

Exactly, exactly.

No, my favorite one was, like, I found in one of my father's.

Like, it was deep in the actual cemetery plot paperwork inside the estate planning book, inside the envelope in the very back of the book.

And I was like, oh, there it is.

Finally, I could not find, for the life of me, find the actual paperwork.

And it was in the actual estate planning book on the part of how to acquire a graveside section.

And it was in there.

And I started laughing because I was like, of course.

Of course.

It is hidden in here.

It felt like the movies, like you're talking about felt like the movie.

There is no will reading.

There's no dramatic.

It's a bunch of attorneys that say, well, we think this is what they wanted to do.

It's their intent.

And so if I can leave your audience with one thing is be very clear on your intent and communicate it to the people that need to hear it.

And, man, thank you so much for coming on and sharing your story.

I think one of the other things that my big takeaway is imparting values matters.

Hearing what you went through involved an insane amount of grit, tenacity, and, like, just an attitude of, hey, we're gonna get this done.

And, like, I think, like, your family had that attitude as well, and they kind of.

They, they.

They didn't prepare you in terms of the new.

The numbers and the estate plan, but they gave you.

They gave you the grit and the determination and the character to get after it.

So I, I, I admire you and I think, you know, we've talked about this on the podcast.

You know, a lot of third generation business owners, shirt, shirt sleeves to shirt sleeves in three generations.

The old Japanese proverb.

I think, you know, you're the third generation.

But Dugan Productions gearing up for, you know, full steam ahead.

So I'm excited to follow along and I appreciate you sharing your thoughts with listeners and I'm excited to see where things go from here.

Yeah.

And yes, let me, and thank you guys so much for letting me come in.

And again, I just want to preface, I'm very, extremely grateful for everything we have, but boy, it could have been a lot smoother and easier and we could be a lot further ahead.

I think we lost a decade because we didn't have the documents in the right order and the, the cash where it needed to be.

But we at the end of the day, just like them.

Put your head down, you grind it out.

And that's the oil and gas industry, y'.

All.

That's why we like what we're doing and appreciate y' all having me all the way out here in Fort Worth.

Absolutely love to have you.

Okay, y', all, awesome.

Well, thanks.

We're signing off.

I love, I gotta call it out.

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It's, we're having a lot of fun with it right now.

So much fun.

So if you have ideas for future episodes or future guests, future topics, critiques, we are all ears and can't wait to hear from you.

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